Urban Outfitters Smartly Invests In Resale Marketplace With Upcoming Nuuly Thrift Launch

Urban Outfitters has started a thrift shop under its clothing subscription rental business that it built in-house, Nuuly. The new service is called Nuuly Thrift and it is launching as an iPhone app this fall.

First, I can appreciate that Urban Outfitters built this in-house rather than use a provider. It's definitely a tougher road, but it gives you a lot more flexibility. More often than not, what it signals is that Urban Outfitters understands the business case for rental and resale apparel marketplace (which have been hugely on the rise with Poshmark and thredUp) versus just choosing a provider and hoping it works out.

A few thoughts:

• I predict this could have some good uptake if the experience is dead-simple as this market is growing like crazy and could actually use more viable players -- even though it will likely lead to more consolidation in the future.

• I appreciate the fact that UO is smart enough to brand this as an independent service rather than under the UO brand. It means it has enough confidence to have it stand on its own and recognizes the potential to create its own independent enterprise value in the future. I agree.

• Another thing I like about this is that they have the audience and customer types to make it work.... but the execution has to be flawless in this sector. There is simply too much competition to have any friction in the process.